Pharmaceutical Supply Chain Risks

PHARMACEUTICAL SUPPLY CHAIN RISKS
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Abstract
Currently, the pharmaceutical industry is one of the most evolving industries in this century. Unfortunately, the industry has fallen victim to globalization in the supply chain where external service providers are determining the level of operation of the industrial activities. The tremendous changes taking place in this field emerge from changing tastes and preferences of consumers who are the major determinants of how far an industry can go in meeting the needs and demands in the market. Some of the notable changes are inevitable because the modes of operations have now shifted. The responsibility of the business has shifted from that of merely providing goods and services to that of providing quality goods and services to the patient. This has burdened the industry and compelled it to resolve to use outsourcing instead of insourcing. The industry is increasingly outsourcing research activities Contract Research Organizations (CROs) and Contract Development Manufacturing Organizations (CDMOs) to its academic and private contract research organizations (CROs) as a strategy to stay competitive and efficient. The competitive increase in demand for quality services coupled with patient autonomy has left the industry with no choice but to resolve to follow what the market dictates. The present study explores how these changes in the pharma industry affect service delivery and the risk of outsourcing to the future of the industry.
Introduction
The present overall outlook of outsourcing in the pharmaceutical industry is brighter and promising than ever (Treva, M. 2017, p. 7). Globalization of supply chain ranging from labor to IT services has taken the core of operational activities in the pharmaceutical industry. Pharmaceutical and biotechnology companies have heavily widened their reliance on external service providers for research and development (R&D) and manufacturing services for operations. The major disadvantage for pharma companies is that they do not source drugs substance and R&D from a single vendor. This has had an adverse impact on service delivery and operations because vendors take advantage of the industry and the cost is transferred to the patient. Additionally, Edmunds et al. (R. 2017, p. 3) note that New Health Economy has posed a serious challenge to the pharma industry as patients are now playing a direct role in services they receive. Patients are no longer waiting to receive services at the table, but have gone ahead to demand an understanding of the treatment and medications they receive. The emergence of online service deliveries and consultations has even made it complicated for pharma and biotech companies to blindly serve clients. Patient autonomy has made it compulsory for the industry to do a self-reflection and evaluation before providing drugs to the market. From the CDMO and CRO perspective, quality drug delivery is only possible if there is division in distribution and delivery of services. Pharma companies lag behind in the integration of these services into one system and they do not have time to overtake the changes that have already taken...